7th Pay Commission latest news: Double dose of good news on dearness allowance! Govt taking big decision on unfreezing of DA, DR

Dearness Allowance of lakhs of employees and pentioners has been put on hold since April 2020.

New Delhi: In further cheer to 50 lakh central government employees and 61 lakh pensioners, the government has reportedly made its decision on hike in Dearness Allowance (DA) and Dearness Relief (DR) as per the current 28 percent rate of inflation.

According to fresh media reports, the government has decided to increased dearness allowance by 4 percent, thus meaning. the dearness allowance of central employees will  increase from 17 percent to 21 percent. Although the benefit of the allowance will start coming from January, there has been no official announcement regarding this. Central employees and pensioners are eagerly waiting for this official announcement of the government.

It was earlier reported that, the Association of Employees Confederation of Central Government Employees and Workers apprised Finance Minister Nirmala Sitharaman regarding the current status of the government treasury and has requested that now all government employees and pensioners should be given dearness allowance as per the current inflation rate of 28 percent.

Dearness Allowance put on hold since April 2020

The finance ministry had in April 2020 decided to put on hold increment in dearness allowance (DA) for 50 lakh central government employees and 61 lakh pensioners till July 2021 due to the COVID-19 crisis.

In view of the crisis arising out of COVID-19, the government had decided that additional instalment of dearness allowance payable to central government employees and dearness relief (DR) to central government pensioners due from January 1, 2020, shall not be paid. The additional instalment of DA and DR due from July 1, 2020, and January 1, 2021, shall also not be paid, the Department of Expenditure said in an office memorandum. However, DA and DR at current rates will continue to be paid.

The last DA hike for central government employees was effected last month effective January 1. 2020. The Union Cabinet had approved a 4 per cent increase in DA for government employees and pensioners to 21 per cent. But with the April decision, this 4 per cent hike was been put on hold.

It was reported by news agency PTI that the combined savings on account of freezing of these instalments of DA and DR to central government employees and pensioners would be Rs 37,530 crore in the 2021-22 and the financial year before that.

Generally, the states follow the Centre order on DA and DR. It is estimated that the savings on suspension of these instalments of DA and DR of state government employees and pensioners will be Rs 82,566 crore, PTI quoting sources had said.